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A U.S. afternoon selloff spoils a global market rebound

August 2, 2021, 10:23 PM UTC

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Good evening, Bull Sheeters. This is Fortune finance reporter Rey Mashayekhi, filling in one more time for Bernhard with a special PM edition of the newsletter.

It looked set to be a resurgent Monday for the global markets after a disappointing end to last week, with the major exchanges in Asia and Europe all posting gains. But while New York initially appeared to be along for the ride, a late-day selloff sent U.S. stocks tumbling to end the day on a sour note.

Markets update

U.S.

  • Markets in New York spiked to start the day, before later giving back their gains and eventually falling into the red late in the afternoon. The S&P ended the session down 0.2%, the Dow lost 0.3%, and the Nasdaq held onto a gain of less than 0.1%.
  • The Jack Dorsey-led payments technology firm Square agreed to acquire Australian “buy now, pay later” fintech Afterpay in a deal valued at $29 billion. Square’s stock (ticker: SQ) jumped 10% on the news.
  • U.S. manufacturing growth cooled for a second straight month in July.
  • The trading of U.S.-listed Chinese stocks hit a record high in July as investors grew skittish over Beijing’s regulatory clampdown on the Chinese private sector.
  • More than 300,000 Robinhood users bought shares in the stock trading app’s IPO last week.
  • A new ETF is designed to bet against tech investor Cathie Wood’s ARK Invest.

Europe

  • The European bourses climbed across the board. London’s FTSE gained 0.7%, Frankfurt’s DAX notched up 0.2%, the CAC 40 in Paris rose 1%, and the pan-European STOXX 600 picked up 0.6%.
  • German financial services giant Allianz saw its stock sink after it revealed a U.S. Justice Department investigation into losses sustained by its hedge funds in the early days of the pandemic.
  • Government bond yields in Europe are falling in a potentially worrying sign for the continent’s economic growth.
  • A fired Deutsche Bank executive says the German bank’s asset management arm overstated its ESG efforts.
  • Pfizer and Moderna are raising the price of their COVID-19 vaccines in new supply contracts with the European Union.

Asia

  • Asian markets put the jitters from last week’s Beijing regulatory clampdown in the rearview mirror (for the time being). Hong Kong’s Hang Seng gained 1.1%; in Tokyo, the Nikkei picked up 1.8%. On mainland China, Shanghai’s SSE Composite and Shenzhen’s SZSE Component jumped 2% and 2.2%, respectively. South Korea’s KOSPI climbed 0.7%.
  • The Chinese manufacturing sector delivered slowing growth in July, and there are signs that the Delta variant is hindering the Asia region’s economic recovery.
  • China’s government is seemingly taking a page out of the U.S.’s playbook by quietly imposing so-called “Buy Chinese” procurement guidelines for state-owned companies.
  • Japan’s Government Pension Investment Fund, the world’s biggest pension fund, significantly cut the weighting of U.S. Treasury bonds in its portfolio during the pandemic.
  • Banks are increasingly pulling back from financing coal power plants in Asia.

Elsewhere

  • Gold gained slightly.
  • The dollar fell marginally.
  • Crude oil slid 3%, with Brent retreating to just north of $73/barrel.
  • Bitcoin sagged below $39,000.

***

That’s all from me; Bernhard will be back tomorrow, surely well-rested and better than ever. Please be sure to check out today’s reads below, and have a wonderful evening.

Rey Mashayekhi
@reym12
rey.mashayekhi@fortune.com

As always, you can write to bullsheet@fortune.com or reply to this email with suggestions and feedback.

Today's reads

Buckle up: August is historically a rough month for stock investors by Anne Sraders

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The fastest Indian tech startup to reach unicorn status is now eyeing an IPO by Biman Mukherji

How London become 2021’s hub for hot new tech IPOs by Sophie Mellor

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Market candy

$31.7 trillion

That’s the aggregate revenue generated by companies on the newly released, 2021 edition of Fortune’s Global 500 listIt's an eye-watering sum that actually shrank 5% from last year, due to—you guessed it—the COVID-19 pandemic. Those companies also reaped a combined $1.6 trillion in profits (down 20% from last year’s list) and employ nearly 70 million people worldwide.

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